Zargon Oil & Gas Ltd ZARFF

Voted NO

[rad10]

(1) Happy to receive PIK in lieu of the March interest payment.  New shares issued at 95% of the VWAP nearer the time. 

(2) Not willing to lose seniority on the capital structure.

(3) Not willing to gift equity to existing shareholders.

(4) Not convinced management has done enough to market the assets.  Their commitment to only sell the whole company in one transaction is rather fanciful and self serving.

Wish you all a very merry Christmas and a prosperous New Year.

[alkhor]

After much consideration, I have also voted no. I have some common shares but in my head they are already worth zero, so I'm expecting the debs to take over the company. In that case, I want the debs to get as much of it as they can. By waiting a year, the debs will convert at around 4 cents, so they will get over double vote is for now.  I remenber when Zargon issued a new offering at

[Method]

The only issues I see with voting no is that the receiver will likely get more than the equity holders and the convertibles are an impediment to any deal for less than $42.5m in value.  The idea that they can pay PIK interest is unfortunately not possible so that’s when they will default and go into receivership.

[helgek]

It was not the Debenture holders that proposed the deal on the table.

[rad10]

The receiver will get more.  The equity is worthless and you can't expect them to work for free. The convertibles are not an impediment.  They are trading where they are for good reason.  Any prospective buyer is looking at the whole enterprise value.  They can make an offer for the debentures or ask to cancel the change of ownership redemption clause.  I would be

[Method]

1. Why pay the receiver more than the equity holders? Shouldn’t we just want to pay the least so there is more for the debenture holders? 2. The converts are an impediment because you need the equity holders to agree to a deal unless we are in receivership but then of course the process is extended for 12-18 months.  3. Management does not seem to want to go down that path and you would

[funfacts2018]

I admit that I'm confused about a couple of comments that I've seen before, and are repeated in this thread. 1) I reviewed the original prospectus and it quite clearly gives Zargon the right to make a "Common Share Interest Payment Election" in which case Zargon has the right "to satisfy its obligation to pay all or any portion of the Interest Obligation on an Interest

[Method]

1. They can choose option 1 but I doubt the trustee could find buyers for $2m dollars worth of stock (40m+ shares) so that is the point they would default on the convertible. This option is different from the PIK interest that rad is proposing.  2. The reason they chose 10 cents/share is because that was the market price at the time and it allows them to avoid a shareholder vote.  3

[pablo87]

Agreed. Even though I’d like to support mgmt, with recent events in the market, I have to take a defensive posture and vote NO and support your suggestion to issue shares in lieu of cash for the March 31. Of note, not a lawyer but with a formal restructuring, the ND assets would be out of reach of AER and possibly debbies would outrank them as well. You have to wonder on a day like today if an